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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: X Y Zebra who wrote (31223)	3/7/2003 12:29:53 AM
From: X Y Zebra	Respond to of 57110

March 6, 4:00 PM: EUR/$..1.0970 $/JPY..117.41 GBP/$..1.6034 $/CHF..1.3338 EUR Rises on ECB 's 25-bp cut, Markets Turn to Bush by Leeanne Su The euro regained the $1.10 level after the European Central Bank cut its refi rate by 25-bp today, bringing the rate to 2.50%. While the move generally met expectations, some had been hoping for a larger 50-bp ease. At the post-meeting press conference, ECB President Duisenberg reiterated that the risk of war was clouding the economic outlook, though he assured markets that the central bank would act decisively if needed, leaving the door open to a future rate cut. He also admitted that the Eurozone economy would likely grow around 1% in 2003. THE ECB's previous forecasts had projected 2-2.5% growth. Addressing the rise in the euro, Duisenberg said the exchange rate was more in line with fundamentals now. He underplayed concerns that the euro's appreciation was reducing the competitiveness of the region, which triggered a large rebound in EUR/USD to a fresh 4-year high at 1.1011. Results of a Reuters poll showed that 28 out of 30 economists forecast a further ECB rate cut this cycle. 9 of the 28 see a rate cut in April while 19 expect a rate cut in May or June. Median forecasts predicted that the interest rate would hit a trough at 2.25%. German Economics Minister Clement commented that the ECB rate cut has improved prospects for economic recovery. France's Fin Minister Mer said EU Monetary Commissioner Pedro Solbes would open the excessive deficit procedure against France, after Mer said French public deficit would hit 3.4% of GDP in 2003. Mer added there would be no tax hikes and that the 3% plus deficit was excessive compared to EU rules but not excessive for the economic situation. Canadian Finance Minister Manley echoed his European counterpart's comments indicating he was not concerned by his currency's appreciation, stating it should be left to the markets. Stronger than expected US data were ignored this morning as they were shadowed by the ECB press conference. US Q4 productivity was revised up to a higher than expected 0.8%, contrary to a previous estimate that productivity saw a 0.2% decline. US factory orders rose 2.1% in January following a 0.3% gain last December. Durable goods orders for January were revised to 2.9%, down from the previous estimate of 3.3%. But weekly jobless claims did rise by 13K to 430,000. more.... forexnews.com USD quotes.ino.com